Saab’s Strategic Expansion in Latin American Defense Markets: A Catalyst for Growth?

Saab’s recent foray into Latin American defense markets has positioned the Swedish aerospace and defense giant as a key player in a region undergoing significant military modernization. With contracts spanning fighter jets, naval combat systems, and advanced radar technology, Saab’s strategic investments are not only addressing immediate regional security needs but also aligning with long-term geopolitical trends. For investors, this expansion represents a compelling opportunity to capitalize on a market projected to grow substantially over the next decade.

Colombia: A Strategic Anchor in South America

The most high-profile of Saab’s Latin American contracts is its agreement with Colombia to supply 16–24 JAS 39 Gripen E/F fighter jets, valued at approximately 35 billion Swedish crowns (€3 billion) [1]. This deal, which replaces Colombia’s aging Kfir fleet, underscores Saab’s ability to secure large-scale defense contracts in emerging markets. The Gripen E/F’s cost-effectiveness and advanced capabilities—such as sensor fusion and network-centric warfare—make it an attractive option for nations seeking to modernize without straining defense budgets [4].

Beyond fighter jets, Saab has secured a critical contract to supply combat systems for Colombia’s Plataforma Estratégica de Superficie (PES) frigates. The package includes the 9LV Combat Management System, Ceros 200 radar, and Sea Giraffe 4A radars, all integrated into frigates built by local shipbuilder COTECMAR [3]. This collaboration not only strengthens Colombia’s maritime surveillance and anti-piracy capabilities but also reinforces Saab’s partnership with Damen Naval, a Dutch shipbuilder, to deliver turnkey solutions. Such localized production partnerships are vital for Saab to navigate regional procurement preferences and reduce reliance on foreign intermediaries.

Radar Systems: Expanding the Regional Footprint

Saab’s Giraffe 4A radar systems have emerged as a cornerstone of its Latin American strategy. In 2025, the company secured a SEK 550 million contract to supply land-based Giraffe 4A radars to an unnamed Latin American country [2]. This system, designed for air and sea surveillance, offers real-time tracking of multiple targets and software-upgradable capabilities, making it ideal for nations seeking to bolster border security and counter asymmetric threats [1].

The Giraffe 4A’s deployment in Latin America follows its successful integration into the Brazilian Navy’s Jerônimo de Albuquerque frigate, demonstrating the system’s adaptability across maritime and land-based platforms [5]. With the Latin American radar market projected to grow at a 7.6% CAGR through 2025 [6], Saab’s early mover advantage positions it to capture a significant share of this expanding sector.

Geopolitical Tailwinds and Market Dynamics

Latin America’s defense spending is being driven by a confluence of factors: rising cross-border tensions, drug trafficking-related security challenges, and a push for regional autonomy in defense production. Colombia’s PES frigate program, for instance, reflects a broader trend of Latin American nations prioritizing self-reliance in naval capabilities [3]. Saab’s partnerships with local industries—such as Brazil’s Embraer for Gripen production—align with these goals, reducing political and economic barriers to entry.

Moreover, the region’s defense market is forecasted to reach $26.47 billion in 2025, with a projected compound annual growth rate (CAGR) of 4.37% through 2030 [7]. This growth is fueled by Brazil’s $12 billion investment in military aviation and radar infrastructure, as well as Mexico’s recent procurement of advanced surveillance systems [8]. Saab’s diversified portfolio—spanning air, land, and maritime systems—enables it to capitalize on these trends across multiple vectors.

Investment Implications: A High-Conviction Play

For investors, Saab’s Latin American expansion offers several compelling advantages. First, the company’s focus on cost-effective, modular systems (e.g., Gripen E/F, Giraffe 4A) aligns with the fiscal constraints of many Latin American governments, ensuring recurring revenue through maintenance and upgrade contracts. Second, Saab’s partnerships with local firms mitigate operational risks and enhance market penetration. Finally, the region’s growing emphasis on technology transfer and joint production—such as Brazil’s Gripen localization initiative—creates a sustainable pipeline for future contracts.

Conclusion: A Catalyst for Global Growth

Saab’s strategic investments in Latin America are more than isolated contracts—they represent a calculated move to establish a long-term presence in a region with untapped potential. By leveraging its technological edge, forming localized partnerships, and addressing regional security priorities, Saab is not only securing immediate revenue streams but also laying the groundwork for future dominance in a market poised for growth. For investors seeking exposure to a defense company with a clear regional strategy and global scalability, Saab’s Latin American expansion is a compelling catalyst.

Source:
[1] Colombia to replace Kfirs with Sweden's SAAB Gripen fighter jet [https://thecitypaperbogota.com/business/colombia-to-replace-kfirs-with-swedens-saab-glipen-fighter-jet/]
[2] Saab receives order for Giraffe 4A radar systems from a country in Latin America [https://news.cision.com/saab/r/saab-receives-order-for-giraffe-4a-radar-systems-from-a-country-in-latin-america,c4229912]
[3] Saab to supply combat systems for Colombia's PES frigate [https://www.naval-technology.com/news/saab-colombian-navys-pes-frigate/]
[4] JAS 39 Gripen E/F Chosen As Colombia's Next Fighter [https://www.twz.com/air/jas-39-gripen-e-f-chosen-as-colombias-next-fighter]
[5] Brazil expands maritime defense with launch of second ... [https://armyrecognition.com/news/navy-news/2025/brazil-expands-maritime-surveillance-capabilities-with-launch-of-second-tamandare-class-frigate]
[6] Surveillance Radars Market Size, Share & Industry Growth [https://www.marketsandmarkets.com/Market-Reports/security-surveillance-radar-market-35330984.html]
[7] Latin America Defense Market - Companies, Size & Share [https://www.mordorintelligence.com/industry-reports/latin-america-defense-market]
[8] Latin America X-Band Radar Market Size 2026 [https://www.linkedin.com/pulse/latin-america-x-band-radar-market-size-mrbuf/]